On February 8, 2023, a Manhattan federal jury found Mason Rothschild liable for trademark infringement for his non-fungible tokens (“NFTs”) called ‘MetaBirkins’. After only 3 days of deliberation, the 9 person jury sided with Hermѐs International and found Rothschild liable for trademark infringement, trademark dilution, and for unlawfully cybersquatting on the domain name MetaBirkins.com.
Read MoreBy Grant F. Butler, Carly E. Howard, Andrew M. Hinkes
The Board of Governors of the Federal Reserve (the “FRB”) issued a policy statement that interprets Section 9(13) of the Federal Reserve Act to limit state member banks to engage as principal in only activities that are (a) permissible for a national bank or (b) explicitly permissible for state banks under federal law. The activity restrictions apply equally to insured and uninsured state member banks supervised directly by the FRB.
Read MoreBy Andrew M. Hinkes, Clifford C. Histed, Cheryl L. Isaac, and Maxwell J. Black
The Commodity Futures Trading Commission (“CFTC”) filed a civil enforcement action this week against Avraham Eisenberg, charging him with a scheme to defraud others and engage in price manipulation (as announced by the CFTC here). While there have been other enforcement actions related to decentralized finance (“DeFi”) protocols, this is the first case in which the CFTC has charged a person for fraud in connection with “oracle manipulation” on a decentralized exchange. In addition to this CFTC action, the U.S. Department of Justice previously charged Eisenberg with criminal fraud and commodity price manipulation in connection with this same alleged scheme.
Read MoreBy Grant F. Butler, Andrew M. Hinkes, Jeremy McLaughlin, Judie Rinearson
The US Board of Governors of the Federal Reserve System (FRB), Office of the Comptroller of the Currency (OCC) and Federal Deposit Insurance Corporation (FDIC) (the “Agencies”) today issued a joint statement reiterating their ongoing concerns with crypto-asset activities entering the banking sector. See: https://www.federalreserve.gov/newsevents/pressreleases/files/bcreg20230103a1.pdf
Read MoreBy Jeremy M. McLaughlin and Brenden R. Chainey
On November 30, Alaska amended its money transmitter regulations to, among other things, include virtual currency transactions within the definition of money transmission. With this new change (effective January 1, 2023), companies engaged in money transmission involving virtual currency will be required to obtain a money transmission license.
Read MoreBy Andrew M. Hinkes, Clifford C. Histed, Carly E. Howard, Cheryl L. Isaac, Maxwell J. Black
Following the unprecedented Ooki DAO enforcement action by the Commodity Futures Trading Commission (“CFTC”), the district court, after entertaining argument by several amici, clarified its position on another novel legal issue in the DeFi space: how to serve process on a DAO. On 12 December 2022, the United States District Court for the Northern District of California ordered the CFTC, as part of its efforts to serve the OOKI Dao, to personally serve the former founders of Ooki DAO as individually identifiable token holders.
Read MoreBy Jeremy McLaughlin and Josh Durham
For the fifth time since June 2022, California Senators have amended their proposed “Digital Financial Assets Law,” signaling a genuine desire to pass the bill as the Senate inches toward workable legislation.
Read MoreBy Grant F. Butler, Jeremy McLaughlin, Anthony R.G. Nolan, and Judie Rinearson
The Federal Reserve Board (the “FRB”) issued Supervision and Regulation Letter 22-6 (“SR 22-6”), providing guidance for FRB-supervised banking organizations (referred to collectively herein as “FRB banks”) seeking to engage in activities related to cryptocurrency and other digital assets. The letter states that prior to engaging in crypto-asset-related activities, such FRB banks must ensure that their activities are “legally permissible” and determine whether any regulatory filings are required. SR 22-6 further states that FRB banks should notify the FRB prior to engaging in crypto-asset-related activities. Any FRB bank that is already engaged in crypto-asset-related activities should notify the FRB promptly regarding the engagement in such activities, if it has not already done so. The FRB also encourages state member banks to contact state regulators before engaging in any crypto-asset-related activity.
Read MoreOn July 12, 2022, the Consumer Financial Protection Bureau (“CFPB”) issued an advisory opinion that states its strict interpretation of the permissible purposes for which a consumer reporting agency may provide a consumer report and for which consumer report users may obtain consumer reports. Section 604(a) of the Fair Credit Reporting Act (“FCRA”) identifies the “permissible purposes” for which a consumer reporting agency may furnish a consumer report.
Read MoreBy Daniel Knight and Kithmin Ranamukhaarachchi
In the wake of the drawn out cryptocurrency market downturn, increased regulation of the sector seems inevitable. With nearly one million Australians transacting in cryptocurrencies last year, there have been widespread calls to enact additional protections for retail investors.
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